The 40% gender pension gap: how Parliament wants to narrow it (interview)
Women in Europe receive a pension that is on average about 40% less than that of men's. MEPs vote this week on proposals to help narrow this gap.
European women earn on average about 16% less than men, but the situation gets worse once they retire as their pension is about 40% less. A proposal to ask the European Commission to come up with an EU strategy to end this gender pension gap is this week making its way through Parliament. MEPs debate the report with recommendations on Monday 12 June and vote on it on Wednesday 14 June. To find out more about the situation and what should be done about it, we talked to report author Constance Le Grip, a French member of the EPP group.
Women earn less than men and work fewer years, so contribute less towards the pension scheme. What other factors are working against them?
Women are overrepresented in poorly-paid jobs and under-represented in well-paid professional ones, such as in the technical and IT sectors. In some countries women support the work of their husbands who are farmers, traders and craftsmen, but their efforts are not officially recognised, so they do not have a full-time salary or contribute towards social security. So they are confronted with many inequalities in their life that when they retire lead to a lower pension than men.
The difference in pensions between men and woman varies from 3.7% to 48.8% in EU countries. Why are there such significant different between member states and which do better than others?
There are a variety of historical and social reasons for this. Retirement systems are up to member states and there is no harmonisation at EU level. Some countries have had equal pay for many years, even before joining the EU. This is of course reflected in the pensions. In other countries women have been less economically active and employed in junior positions, on a part-time basis or in insecure jobs.
Why is the pension gap increasing in half of the member states?
This still needs to be analysed further, but I would say that the economic and social crisis has tended to make inequalities worse. It has made it worse for people in vulnerable positions, who tend to be women.
What measures to you propose to narrow this pension gap?
This should remain the responsibility of member states, so we don't want to propose a harmonisation at EU level. However, first of all we need to raise awareness of the issue and the continuing inequalities. The countries with the best results are those that have been careful to working towards true equality. When calculating pensions that also includes taking into account time spent putting a career on hold in order to look after children.
The Parliament and the Commission could work on a general European strategy to encourage member states to analyse the inequalities and put into place measures to overcome them.
In your report you say that we should encourage people to find out more about their finances, especially women. How should this be achieved?
It's more about making women aware of the importance of this. When they start their career, they should be careful to check they earn enough and that they are well informed about how the pension system works in their country. For example, part-time work might seem like an attractive option, but it can work against you if you do it for too long as it will lead to a lower pension when you retire.
In some member states up to a third of retired women don't have a pension. How is this possible?
These are the wives of the farmers, traders and craftsmen I mentioned earlier, who worked for many years but received a low salary that did not reflect their efforts. It's not because they did not declare their income; it's because their contribution is not taken into account enough.